Skip to content
Subscriber Only

Lira in Freefall to Spur Off-Schedule Rate Boosts: Turkey Credit

Updated on

Turkey’s central bank will probably have to intervene with an off-schedule rate increase after its Aug. 20 decision to raise the overnight lending rate was unable to contain a market selloff, according to Citigroup Inc.

Since the central bank boosted the upper end of its three-pronged rates corridor and left the other rates unchanged, the lira fell to a record and 10-year bond yields surged above 10 percent for the first time in 19 months. Turkey has led a jump in yields from Indonesia to Brazil in the past three months as speculation grew that the Federal Reserve will curb stimulus.